IG harshly criticizes Treasury’s handling of $700B bailout

By Silla Brush – 10/21/09 12:01 AM ET

Steps taken by the Treasury Department to implement the $700 billion financial bailout program have undermined the credibility of the U.S. government, a top government watchdog said in a report released on Wednesday.

Neil Barofsky, the special inspector general over the Troubled Asset Relief Program (TARP), as the financial bailout is known officially, criticized the Treasury Department for failing to require banks to detail exactly how they are using the money. Barofsky also criticized the Treasury Department for not being more forthright about how and why it selected the first nine recipients of TARP money.

“Treasury’s actions in this regard have contributed to damage the credibility of the program and of the government itself, and the anger, cynicism, and distrust created must be chalked up as one of the substantial, albeit unnecessary, costs of TARP,” Barofsky said in the report.

The TARP program remains one of the most controversial government programs in decades, though Barofsky said it has played, “a significant role in bringing the system back from the brink of collapse.”

via IG harshly criticizes Treasury’s handling of $700B bailout – TheHill.com.